State legislature is looking at the budget for the two-year 2015-2017 budget. Top oil regulator Lynn Helms addressed the lawmakers. Underlying substance hasn’t changed. There will still be another 60,000 wells drilled over the next 25 years. There is still somewhere around 20 billion barrels of oil in the ground. It isn’t going anywhere.

Here are some tidbits he mentioned about drilling rig count

196 – count in September ‘14

166 – count this week

150 – possible count by July 1

125 – possible count 12/31/15 if crude prices stay very low

140 – new wells needed per month to maintain production

Count of wells awaiting completion is up to around 700. Mr. Helms points out drillers aren’t rushing to frack the sites with prices in the $40s.

Tax exemptions for producers kick in at certain points:

$55 – trigger point for a smaller of two rate cuts, apparently rates of West Texas Intermediate below that point for a short time triggers a cut

$52.59 – if WTI is below that amount for five consecutive months there is a large rate cut.

Very short version is that as of 12/28/14, the transport cost is about $14 a barrel to the west coast or $19 to east coast by rail. Getting to Cushing by rail is $15/bbl and by pipeline is about $9. To the Gulf coast is about $17/bbl by rail and about $11 by pipeline.

Spreads between the coast prices and Gulf coast narrowed in 2014, which made it less profitable to ship to the coast.

Article calculates the netback averages in 2013 were from $83/bbl to $94/bbl depending on location and method. Estimate for 12/26/14 is about $40/bbl by rail to any of the locations and $46/bbl by pipeline to either Cushing or the Gulf.